Re-Defining Luxury

According to the IBISWorld report, the definition of luxury in the current year needs to be redefined, with simplicity, and eco-friendly features being at the core of the new Luxury definition. Since 2008, unemployment has soared, consumer confidence crashed and disposable income plummeted, resulting in a consumer that became very money-conscious and a ‘budget’ consumer. However, not because one does not have the possibility to buy what is considered glitzy luxury that one cannot continue to desire them. Amongst the difficult economic trend, this has impacted both the consumer and the luxury industry. The affluent consumer began to re-determine his needs, wants and desires, while the luxury industry had to adapt to the consumer who still desired luxury, yet no longer could afford the above 60,000 USD sports car, or the Spa treatment of 500 USD or the python satchel at nearly 3,000 USD. This lead to the development of a simpler, cheaper, and more practical definition of the luxury industry. With globalization and social corporate responsibility becoming arising factors in all industries, the luxury industry has created a new focus towards simple and eco-friendly features, to be line with the changing society needs, wants and desires. One might wonder then, if the new definition of luxury is determined especially by simplicity, practicality and eco-friendly features, than why is it, that brands continue producing for example Venom GT2, with a 7.0 liter turbo engine (as shown below), for a starting price of 1.25 million USD? Venom GT2

Or the new Chanel watch collection (picture below) with a price only available on request? Chanel Watch

Even as the consumer changes, and as the luxury industry tries to adapt to the changing consumer, there is always a small niche market which will be able to afford such high-end, and expensive goods, hence the luxury industry’s foremost goal remains catering this small niche market, before catering the consumer with less money. Hence, the glitzy luxury goods will always be present on the world market. Based on article from the LA Times